The Ultimate BTO Buying Guide for First-Time Homeowners

I recently caught up with a couple of friends who happened to be in the midst of planning to buy a BTO. One of them was single, while the other was engaged. Despite being very different people and at different stages in their lives, they both shared their frustration with the lengthy and complicated BTO purchasing process, which I’m sure many of you as first-time homeowners-to-be also experience.

Image credit: Ivan Yeo, Unsplash 

As a good friend, I wanted to assist them (and you, of course) by creating a comprehensive guide that brings together all the necessary information, hopefully making the buying process a little smoother and reducing the stress involved.

Besides taking you through the different stages, there’s also a handy table summary of abbreviations you will want to know, located right at the end of the article. Click through the links below to make it easier to reach the information you need. 

Contents: 

Stage 1: Check If You’re Eligible
Stage 2: Plan Ahead To Determine Flat Size And Loan Type (HDB Or Bank)
Stage 3: Apply For HFE Letter
Stage 4: Consider The Flat Size You Need
Stage 5: Keep An Eye Out For Sales Launches
Stage 6: Time To Choose Your Flat!
Stage 7: Signing The Agreement For Lease
Stage 8: The Waiting Game (what to do at this stage?)
Stage 9: Finally, It’s Time To Collect Your Keys
Table Summary of Abbreviations to Know

Stage 1: Check if you’re eligible

First things first, make sure you’re actually eligible for a BTO. For obvious reasons. 

Here’s a quick summary of the general requirements and restrictions.

	Couples and Families	Singles (if you're buying a flat on your own)
Flat type availability	Up to a 5-room flat	2-room Flexi Flat in non-mature estate currently. By second half of 2024, singles will be able to purchase 2-room Flexi flats across all BTO classifications.
Citizenship	You must be a Singapore Citizen or have at least 1 other Singapore Citizen or Singapore Permanent Resident between the core applicants.	You must be a Singapore Citizen
Age	At least 21 years old	At least 35 years old
Monthly household income ceiling	$7,000 - $21,000, depending on size of flat, project type and if purchasing with extended family	$7,000
Private home ownership restriction	If you have a private home previously, you must have disposed of it 30 months before HFE letter application if you are applying for a BTO/applying for a HDB grant	If you have a private home previously, you must have disposed of it 30 months before HFE letter application if you are applying for a BTO/applying for a HDB grant
Other requirements	For couples, you need to solemnise your marriage within 3 months from the completion of the flat purchase. If you intend to get a 3Gen BTO flat, you will need to apply it with your parents (one of whom will need to be a Singapore Citizen)	You can also buy a 2-room Flexi BTO with other singles (up to 3 other singles). One of the applicants will need to be a SC. The other criteria remain the same.

Stage 2: Plan ahead to determine flat size and loan type (HDB or bank)

Once you’ve made sure you are eligible for a BTO, start to plan ahead.

Check your finances to see what size flats you can go for, the possible housing grants you can get, and also to explore your housing loan options—do you want to go for an HDB loan or get a bank loan?

This HDB calculator (https://homes.hdb.gov.sg/home/calculator/budget) is a good tool to help estimate how much you need to pay each month and the total interest you need to fork out, giving you a better idea of what flat size to go for. CPF also has a similar tool here.

Screen grab of HDB calculator 

If you decide to go for a bank loan, apply for an in-principal approval (IPA) from your chosen bank for a preliminary assessment of how much the bank wants to lend you. You can also request for an IPA and a Letter of Offer (LO) from participating banks when applying for your HFE letter (see Stage 3).

The LO is needed before signing the Agreement for Lease (see stage 7).

Bank loan or HDB loan? We could dedicate an entire article to this simple question, but the main difference lies within the interest rates as well as the downpayment terms. 

The interest rates for HDB loan is at 2.6% currently, and is pretty much fixed as it is always 0.1% above the CPF rate, while bank loans are highly dependent on market conditions. Check the current interest rates for the different banks here. 

You will also have to fork out more cash for your downpayment if you’re taking up a bank loan (see stage 7 below). 

Stage 3: Apply for HFE letter

As you're working on your budget, it would be a good idea to also apply for an HDB Flat Eligibility (HFE) letter at the same time. Starting from May 2023, the HFE letter has replaced the HLE letter. This letter will let you know if you're eligible to purchase a BTO, receive housing grants (and how much you might get), and qualify for an HDB housing loan. 

Heads up: you will need a valid HFE letter when you apply for a flat during a BTO sales launch so you have to get one BEFORE the launch. 

Image credit: HDB

When to apply?

It takes about 1 month to process your HFE letter application, although this may be longer especially just before a BTO sales launch. So do apply early. 

How long is the HFE letter valid for?

Your HFE letter is valid for 9 months.

Where to apply?

Go to the HFE link on HDB’s website: https://homes.hdb.gov.sg/home/landing

You will need a valid Singpass account.

Make sure the applicant and occupier listed in your HFE application are the same as your flat application later on.

There are two steps to the application process before you receive your results. You can view your HFE letter in the HDB flat portal.

You will also be able to see what priority schemes you can qualify for when applying for an HFE letter. Check out the many schemes available here. 

Stage 4: Consider the flat size you need

After getting your HFE results, you'll have a better sense of the size of flat that fits your budget. In addition to the practical considerations, think about your lifestyle, family size, and future plans. Are you thinking about starting a family, do you need a home office for remote work, or are you considering living with your parents down the line?

4-room floor plan for BTO Bedok North Springs (launched in Feb 2024); a typically 4-room BTO layout

If you need to get a good gauge of how each flat size really feels, head down to HDB’s My Nice Home Gallery at HDB Hub.

Larger size flats like 5-room flats offer a ton of renovation potential as well. Check out these 5-room BTOs with unconventional open floor plans.

Hey singles, just because you're limited to 2-room Flexi flats for BTOs doesn't mean you can't work some magic with a small living space. Check out how these homeowners have transformed their tiny square footage and get inspired. 

Stage 5: Keep an eye out for sales launches

Now to the exciting bit: BTO sales launches! There will be 3 sales launches in 2024, with the first one already out this month. The other two launches are in June and October. You can check out the upcoming locations in advance on the HDB website. 

 

Sign up with HDB to receive an alert whenever there’s a new launch. 

I cannot emphasise this enough: Make sure you have a valid HFE letter before applying for a flat during the sales launch. (See stage 3 if you skipped that part.)

During a sales launch, you will get to see the exact location of the site, estimated completion date (crucial!), the units available, and some preliminary designs and facilities of the estate. If you have the time, we recommend heading down to the site itself to get a better feel of the surrounds.

Applications for flats are conveniently submitted online, with a $10 administrative fee for each application. If you need to make changes such as selecting a different town or unit size, you can do so during the application period. Just remember to cancel your previous application and reapply in time before the deadline!

After the application period ends (8 days later), a computerised ballot system is used to allocate queue numbers for booking a flat. You can expect to receive your queue number within 2 months after the application period closes.

If you aren’t keen on the BTOs launched, you can always check out the Sale of Balance Flats (SBFs) or the ones available under the Open Booking. As their names suggest, these are “leftovers” from previous launches that were unselected. Flats under these schemes will have a shorter waiting time. Most are already under construction, soon to be completed or already completed. Read more about them on HDB. 

As you wait for your queue number, why not head over to our blog (https://www.renonation.sg/articles) and check out our unit analyses? We offer a detailed look into each BTO launched during the sales exercise, exploring the surrounding amenities and environment. We also offer insights into the best units to choose based on factors like afternoon sun direction, noise levels, and privacy.

Our unit analyses help you choose the best flat! 

Stage 6: Time to choose your flat!

Once you received your queue number confirming your successful application (congratulations!), you will be invited down to HDB to book a flat. Typically, invitations are sent out around 4 weeks after the results are announced.

And it's decision time: Choose the stack and unit that best suits your preferences. Make sure you've taken the time to read our unit analyses to help you make an informed decision. If you can, visit the HDB Hub before your appointment to see the model of your BTO project. This will give you a better understanding of the location of your stack or unit in relation to the neighbouring blocks.

Image credit: HDB

Make sure to have a few different unit options in mind just in case the ones you originally wanted are already taken. Side story—my top choice unit was actually snagged by the person one number ahead of me in the queue! Luckily, our second choice was still up for grabs.

Because nothing is free in this world, you will need to pay for the option fee at this stage. The amount will be determined by the size of your flat. It will range from $500 to $2,000 and will be, thankfully, part of your downpayment.

At this stage, you will also have to decide whether you want to opt in to the Optional Component Scheme (OCS) if your BTO has the choice to do so. If you decide to opt in fully or partially to the OCS, where your unit can come furnished with floor finishes, doors, and sanitary finishes. Consider if you like the designs available and if they will fit in with your overall theme—pays to think ahead! There are usually a few designs available, which you can view on site as well.

Opting in to the OCS

BTOs that are built using the Prefabricated Prefinished Volumetric Construction (PPVC) AKA the “lego” method, will come with full floor finishes, internal doors, and sanitary fittings already, so you won’t get to opt in or out of those. 

When you receive the invitation package, it will include a list of documents that you will need to bring with you when you go to book a flat. Be sure to bring your identification documents, a valid HFE letter, marriage certificates (if you were only engaged when you applied for the flat), your NETS card (for paying the option fee), and birth certificates and parents' marriage certificates (if you are purchasing under the multi-generation priority scheme or the married child priority scheme).

Stage 7: Signing the agreement for lease

As you near the finish line, once you've selected your unit, you can expect to wait around 6 to 9 months before returning to HDB Hub to complete the lease agreement. This step confirms that you are the approved tenant for the flat (with HDB being the landlord).

There is more payment involved at this stage, so pay attention.

First things first, you will have to put down your downpayment. The amount you need to pay depends on what type of loan you are going for. 

	Downpayment
HDB Loan	10% (can be paid via cash or CPF)
Bank Loan	20% (5% needs to be cash, 15% can be via cash or CPF)

Other fees you need to pay for include stamp duty and legal fees, the amount of which are dependent on the purchase price of your flat.

Use this stamp duty calculator on the IRAS website to determine how much that will be.

Legal fees are calculated as such:

• First $30,000: $0.90 per $1,000
• Next $30,000: $0.72 per $1,000
• Remaining Amount: $0.60 per $1,000

If you are opting for staggered downpayment scheme, the first part of the downpayment will be paid at this stage and the second part of the downpayment will be paid at the key collection stage (see stage 9 below).

Stage 8: The waiting game

During this stage, it's all about being patient. Remember to keep your expectations realistic when it comes to the timeline for BTO completion. The estimated completion date provided when you secured your flat is usually quite accurate, but unexpected events (like a global pandemic) can sometimes cause delays.

In the meantime, take some time to relax (because once you get your key collection, it’s go go go!) and explore different options for your home. Consider researching interior designers (a little shameless plug here: Renonation.sg is a great resource!), and start making plans for your upcoming renovation.

We recommend connecting with interior designers around 6 months before your estimated key collection. This will allow you to get a sense of their availability and pricing, ensuring that you receive accurate quotes.

Screen grab of Renonation.sg's quotation form. Fill this up and we'll get you in touch with our interior design partners

If you don’t know where to start, we also provide floor plan ideas that work with your BTO floor plans. Head down to our blog, search for your BTO name in the search bar to get to the right page. 

As you wait for your keys, do remember to save up for your home renovation. A lot of it really depends on the materials you opt for, what you want to do, and how much you are willing to pay for it, but we recommend saving up at least $35,000 if you are renovating for a 3-room and $55,000 if you are renovating a 5-room based on our stats for 2024.

At this point, you might also want to look into different home insurance options (we've partnered with Etiqa if you're considering hiring an interior design firm through us. Click here for more information), connecting with your BTO group for group buys (many are organized on Telegram now), and browsing for furniture and decor.

Stage 9: Finally, it’s time to collect your keys

And now, it's finally time to pick up your keys to your BTO. You'll need to make another trip to HDB for this.

At this point, you'll be required to settle the remaining balance for your flat (get ready your singpass login information to clear out your CPF savings!), along with the registration fee of $38.30, and the survey fee based on your flat type.

Do set aside a whole day for this, because if you are just as excited as I was, you may also want to head down to your new flat to check it out immediately after collecting your keys.

Oh, the excitement! 

You will need to prepare more documents before heading down to HDB Hub. HDB usually sends you a pretty handy checklist, so take a look and prep in advance. 

Don't forget to apply for fire insurance from HDB's appointed insurer if you are getting a housing loan from HDB. FWD Singapore Pte Ltd is currently the insurer in charge. This insurance is valid for 5 years (which coincides with the minimum occupancy period), and you will need to renew it once it expires. More details about the fire insurance premium and coverage here. 

For homeowners who are using CPF to pay for their monthly loan instalments, you will need to be insured under the Home Protection Scheme (HPS). See how much you will need to pay using this calculator.

If you intend to start your defects check on the day of your key collection, do activate your utilities before then. You can open a utilities account with SP Services online, and then book a date and time with their technician to turn on your utilities, preferably before you start your defects check. With your utilities turned on, you can check for things such as whether your power outlets are working and whether your toilet is flushing properly.

And phew, that's it! Take a moment to soak it all in and get ready to start this exciting new chapter of your life.

 

Table summary of abbreviations to know for first-time BTO homeowners
HFE letter	HDB Flat Eligibility letter	This letter, which needs to be applied before your flat application, will inform your eligibility to buy a new flat, the grants you can get and the loan you will need to take up.
PLH	Prime Location Housing	BTO projects set in prime and central locations. Will soon be replaced by the Prime, Plus and Standard models after the second half of 2024.
SBF	Sales of Balance Flats	Flats that were not taken up during the previous BTO launches. These flats tend to have a shorter waiting time. From 2024, there will only be one SBF exercise per year. For 2024, this will be in February.
IPA	In-Principle Approval	Applicable for those who are taking a bank loan. You'll need to request an IPA from your preferred bank. This document will help determine your eligibility for the loan by providing information on how much funding the bank may be able to offer you.
LO	Letter of Offer	Applicable for those who are taking a bank loan. The letter of offer is a formal agreement between you and the bank on your loan details (loan amount + duration). You will need this document before signing the agreement for lease.
OCS	Optional Component Scheme	Under OCS, you can opt in to have sanitary fittings, internal doors and flooring done up by HDB so you won’t have to get them yourselves. The price for these will vary and will be added onto your purchase price of the flat. Designs are limited though, so make sure they will be able to fit in with your overall scheme.
PPVC	Prefabricated Prefinished Volumetric Construction	A construction method for BTOs. BTOs built using this method typically have a shorter waiting time, and they come with floor and wall finishes, internal doors, window frames, sanitary fittings, and a basecoat of paint.
HPS	Home Protection Scheme	If you are using CPF to pay off your monthly housing loans, you will need to get insured under HPS. This insurance scheme will provide protection in the unfortunate event that either you or your spouse/family member passes away, becomes terminally ill, or becomes permanently disabled and is unable to pay off your housing loans.